Financing WASH services poses a serious and growing challenge in developing countries. Governments, civil society and communities are struggling with issues such as decentralisation, adequate fund allocation and cost recovery. Few countries have realistic and operational policies and strategies to enable sustainable financing for increased WASH service coverage, particularly for the poor.
To overcome these challenges, market forces must be recognised and appropriately considered, and small enterprises may have an opportunity to flourish when properly addressing water and sanitation in a locally regulated business sector. Governments have to prioritise WASH in their own budgets, using tax revenues for investment.
The financial approach of the WASH Alliance is built on a variety of strategies to promote mechanisms and introduce models that create incentives for various stakeholders to contribute to the financing of WASH improvements.
Budget tracking is a possible way forward towards accomplishing the objectives of the two leading principles of the FIETS: financial sustainability and institutional sustainability. Budget tracking is needed to make sure funds from the national level will reach the right beneficiaries. Lobby at national and international level should convince public and private stakeholders to invest in and create an enabling environment for WASH services.
Public Expenditure Tracking Surveys (PETS) are the most common form of budget tracking used by the World Bank. Here you can download a document about PETS and budget tracking. This Briefing note was written by IRC (International Water and Sanitation Centre). It was presented and discussed with DWA members during the Workshop: Finance for WASH, Learning from Practice, held in Leiden, The Netherlands, February 2012.